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2.3 and 3.4 GHz award – stakeholder Q&A

09 February 2018

Ofcom has received a number of queries from stakeholders on the upcoming 2.3 and 3.4 GHz auction. We have published these queries and our responses below.

Please send any questions about the 2.3 and 3.4 GHz auction to pssr.award@ofcom.org.uk. Please be advised that Ofcom will make answers to relevant questions available on our website. However no questions will be attributable to any organisation.

Auction spectrum may be used for backhaul in a point to multipoint configuration (there is nothing stopping the multipoint end actually being a single point). However the multipoint end must be considered as a fixed or mobile terminal station with associated technical parameters. Higher power than this would not be possible.

The licences are technology neutral so any technology that is compatible with the "preferred" or "compatible" frame structures as defined in the draft licences (Annex 1 and 2 of the Information Memorandum) is possible provided the corresponding block edge mask is used. A 1 millisecond timeslot is required for the defined timeslots in each of the frame structures. Variations could be agreed with other licensees after the award.

The illustrations provided in sections 5.52 to 5.55 were based on some confidential information that Ofcom is not able to make available to prospective bidders. However we consider that the radiated power, number and location of proposed sites within the timeframe of the coordination requirement are the key elements of the coexistence assessment. Prospective bidders will have their own view of the density and power levels of their planned deployments and should assess the requirement using the methodology specified in Annex 5 of the Information Memorandum.

This policy has not changed in this respect since our previous consultation on draft auction regulations. Please also note that for all previous spectrum auctions, our policy was to require cash deposits.

Applicants will have to provide an initial deposit of £100,000 (draft Regulation 4(3)(b)) and should they qualify and become a bidder, applicants will have to provide an additional deposit of at least £900,000 (draft Regulation 17 (1)).

In terms of lot size, we note that in contrast to the 3.4 GHz minimum requirement rule (draft Regulation 6), the draft regulations do not contain a requirement that bidders specify in their application document a minimum requirement for 2.3 GHz.

The 2.3 GHz frequencies available in the auction are comprised of four 10 MHz lots, each of them covering the whole of Great Britain, within the frequency range 2350 MHz to 2390 MHz. Bidders may bid for between one and four of these lots, subject to existing spectrum holdings.

Question

In the information memorandum 'The award of 2.3 and 3.4 GHz spectrum bands' published 11 July 2017, it says in Annex 3 ‘Example 3.4 GHz licence’ the following:

'Irrespective of whether the Restrictive Transmission Mask or the Permissive Transmission Mask is being used, the EIRP emanating from the Radio Equipment transmissions at any frequency outside the Permitted Frequency Blocks shall not exceed the following additional band edge requirements:

3405 MHz – 3410 MHz3600 MHz – 3605 MHz

Min(PMax – 40, 21) dBm / 5 MHzEIRP per antenna

3400 MHz – 3405 MHz

Min(PMax – 43, 15) dBM / 5 MHzEIRP per antenna

3390 MHz – 3400 MHz

Min(PMax – 43, 13) dBM / 5 MHzEIRP per antenna

Below 3390 MHz

- 50 dBm / MHz EIRP*

Above 3605 MHz (see Note 2)

- 34 dBm / 5 MHz EIRP*

* The maximum mean power relates to the EIRP of a specific piece of Radio Equipment irrespective of the number of transmit antennas.

We would like to clarify the extent to which the out-of-band emission criteria defined by Ofcom apply. Reading literally the emission criteria of -50 dBm / MHz EIRP applies all the way to DC (i.e. zero Hz). Additionally -34 dBm / 5 MHz EIRP is not upper bounded.

Our understanding is these out-of-band emission criteria have been designed to protect adjacent spectrum users and so we are currently interpreting these as follows:

-50 dBm / MHz EIRP applies from 2700 MHz to 3390 MHz

-34 dBm / 5 MHz EIRP applies from 3605 MHz to 3800 MHz

Outside of these frequency ranges we assume standard 3GPP spurious emissions would apply.

Answer

The emission mask requirement below 3400 MHz was subsequently modified by Ofcom to below 3390 MHz. This requirement (as shown in the extract from the licence conditions you provided in your email) is taken directly from EC Decision 2014/276/EU, although our understanding is that this was put in place to protect the adjacent radar band.

The above 3605 MHz requirement was originally put in place by Ofcom in order to protect the usage by the licensee of 3605 to 3689 MHz which has slightly different technical conditions. However, you should also read Note 2 in the above table which is relevant to when the above 3605 MHz threshold is applicable.

We are minded to adopt a similar approach to that which we used in the 4G auction in 2013. The approach at that time was set out in guidance, a copy of which can be found on p. 38 of the December guidance (PDF, 279.3 KB).

On Wednesday, 24 January 2018 (the day we intend to make the Regulations) we are publishing a document containing guidance on how potential bidders can take part in the auction. This document will contain, amongst other things, indicative information regarding timelines for the auction.

As set out in the notice published on our website on 17 January, Ofcom intends to make the regulations for the auction of the 2.3 GHz and 3.4 GHz spectrum on 24 January 2018. The Regulations would then come into force on 31 January 2018. Once the Regulations are in force we will announce the date on which we will accept applications to participate in the auction. We anticipate that the day for receipt of applications will be around 7 days after the Regulations come into force on 31 January 2018. Those wishing to participate in the auction will therefore need to submit their application and also transfer into Ofcom’s bank account the initial deposit of £100,000 on the same day.

On the day that the regulations are made we will publish a document containing guidance on how potential bidders can apply to take part in the auction.

Question

Training version of auction software made available with passwords etc

Actual

09/02/2018

Bidders notified of other bidders

Actual

15/02/2018

Deadline to notify of bidder group overlaps

Actual

16/02/2018

Ofcom notifies of deadline to resolve bidder overlaps

Actual

23/02/2018

Bidder overlaps to be resolved

Not before

19/02/2018

Notification of qualification & last date for withdrawal- earliest of 2nd business day after notification of overlaps (which means 19/2). Date will be later if legal appeal not completed, or if overlaps that need resolving

Not before

22/02/2018

Last date for withdrawal - 3 days after notification of qualification

Not before

23/02/2018

Bidders published on Ofcom website

Not before

23/02/2018

Notification of requirement for additional deposit

Not before

26/02/2018

Auction software passwords made available (within 2 days of last date for withdrawal)

Not before

02/03/2018

Additional deposit due

Not before

05/03/2018

Eligibility points notified

Not before

06/03/2018

Notification of start of Principal Stage

Not before

08/03/2018

Principal Stage begins

Could you please confirm if these dates align with your intent?

Answer

The timings shown in the ‘Process guidance to potential applicants and bidders’ published on 24 January 2018 are illustrative only, based on our reasonable ‘best estimates’. We understand that potential applicants will need to consider practicalities, but we do not think it would be helpful to speculate further about potential timings at this stage, given the number of variables involved.

We will notify applicants/bidders of timings for key auction events as they become clearer.

Section A1.6 of the Process Guidance to Potential Applicants and Bidders in the Auction states that Ofcom’s preference is for all payments to Ofcom to be made in GBP from one bank account. Where bidders have to make payments from two bank accounts, they should provide details of both accounts in their application form.

In section 3 (Directors or members of managing body) of the Application form and warranty (Schedule 2 of the Wireless Telegraphy (Licence Award) Regulations 2018) it states ‘Provide the name and job title of each of the directors of the applicant or each of the members of the managing body of the applicant’. However, Ofcom cannot see any reason why you should not include the members of your Executive Team (which includes [REDACTED] Statutory Directors) in addition to the names and job titles of the directors if you wish to do so.

You can log in to the EAS from different computers, but you can only have one active session at a time. To access the EAS, you must install the digital certificates for EAS authentication (provided by Ofcom) on any browsers you intend to potentially use for the auction, and on any computer you may use to access the EAS. More information will be included in the EAS bidder manual that will be issued to applicants shortly after application day.

Prior to submitting an application it is for stakeholders to interpret the Wireless Telegraphy (Licence Award) Regulations 2018 on appropriate legal advice. Ofcom will not at this stage advise stakeholders on the interpretation of the legislation. Ofcom will take decisions on qualification to participate in the award process after applications for the grant of a licence are submitted.

It is acceptable to pay the deposit using a UK account held at a UK Bank where the account holder is a Group Company based abroad. In the case of payments made by UK banks, Ofcom can confirm that its bank (Lloyds Bank) will not charge a fee for receiving electronic payments using the CHAPS system unless the issuer specifically requires that changes associated to the transaction are covered by the receiving bank, i.e. Ofcom’s bank (Lloyds Bank). It is the bidder or applicant’s responsibility – not Ofcom’s – to ascertain what fees may be required. Where the issuer requires that charges are paid by Ofcom’s bank, bidders or applicants must ensure that they adjust the amount transferred accordingly.

At this stage it is for companies to interpret and apply the rules on applications for the auction in the Wireless Telegraphy (Licence Award) Regulations 2018. It is open to companies to take legal advice on the requirements. Ofcom is not in a position to know what information has been disclosed between companies and advisers to date. Ofcom will assess applications after they have been received.

The spectrum holdings referred to in Section 2.20 of the ‘Process guidance to potential applicants and bidders in the auction’ and for which details are required on the application form and warranty only relate to spectrum held under UK Wireless Telegraphy Act licences. The meaning of existing spectrum holdings is given in regulation 5 of the Wireless Telegraphy (Licence Award) Regulations 2018.

The name of the contact on the deposit payment form in Annex 1 of the ‘Process guidance to potential applicants and bidders in the auction’ does not necessarily have to match the individual contact designated on the application form.

Paragraph A2.4 of our “Process guidance to potential applicants and bidders in the auction” states that qualified bidders will be notified of a phone number to contact the Auction Team during the bidding stages.

For a replacement licence to have been applied for (Regulation 7) the pre-existing licence holder would have needed to be an applicant and would have been included in the list of applicants notified under Regulation 8(1).

The notification in respect of regulation 14(1) does not contain the details shown in regulation 14(1)(c) because the pre-existing licence holder has not applied and qualified to participate in the award process. As such, the pre-existing licence holder has not applied for a replacement licence.

a. The ’Process guidance to potential applicants and bidders in the auction’ published by Ofcom states that ‘bidders may choose to lodge sufficient funds in excess of their minimum further sum required in Ofcom’s auction account to cover any anticipated future requirements’.

b. If bidders choose to duplicate payment of deposits these monies will be held on deposit with Ofcom.

Paragraph 6.1 of Ofcom’s published Process guidance to potential applicants and bidders in the auction states that we expect bidding will normally run from no earlier than 09.00 to no later than 17:30 on business days only. Our intention is therefore not to conduct the auction on 30 March 2018 and 2 April 2018, and we would resume bidding on Tuesday 3 April 2018.